High unemployment undermines ‘Swedish model’

When Adam Lundborg, a 25-year-old business graduate, began handing out fliers on a busy shopping street in central Stockholm this summer, he was selling a product he knew better than most: himself.

The leaflets featured a short presentation of Lundborg and the type of jobs he was looking for: “any challenges you throw my way.”

“I graduated from university with top grades, but when I entered the job market it was like hitting a brick wall,” he said.

On his second day of job hunting, Lundborg was offered a job by a company that had read about him in a newspaper. Yet the opening — described in the media as a “dream job” — turned out to be a commission-based telemarketing position.

He ended up resigning, choosing instead to spend his time calling chief executives at companies he would like to work for, hoping to get a chance to introduce himself.

Lundborg is a victim of Sweden’s persistently high youth unemployment, a hot-button issue in a country that has weathered the financial crisis better than most.

Although Sweden’s export-driven economy is beginning to feel the effects of Europe’s economic woes, it has posted strong growth since making a quick recovery from the 2008 recession. It also has a low level of government debt.

Yet youth unemployment has remained above the European average, reaching a seasonally adjusted 23 percent last month, compared to 7.7 percent for the population as a whole, government agency Statistics Sweden said.

Last year, Swedes aged 15 to 24 were more than four times more likely to be without work than the rest of the workforce, the highest ratio in Europe, Eurostat said.

Even during the boom years before the crisis, Sweden’s youth unemployment hovered at 25 percent.

Employers place the blame on employment protection laws and high entry level wages championed by Sweden’s powerful unions.

“The barriers to entry to the job market are especially high in Sweden, leaving many young people on the sidelines,” said Malin Sahlen, an economist at the Confederation of Swedish Enterprise, who on Tuesday released a book on the subject.

In her book, Sahlen argues that the high cost of firing workers means employers are reluctant to hire people with little, or little known, experience, making it tougher for young people and immigrants to gain a foothold in the job market.

Moreover, the high level of pay for entry-level jobs give firms little incentive to choose young people over more experienced candidates.

The Swedish Trade Union Confederation (LO), a close ally of Sweden’s Social Democratic Party, which has dominated political life in Sweden for much of the past century, painted a different picture.

“Many of those between 15 and 19 who are registered as unemployed are full-time students looking for part-time work and that group of people really isn’t a problem,” LO ombudsman Oscar Ernerot said.

“Sweden has a higher number of full-time students looking for part-time work,” he added when asked about comparisons with countries that have a lower rate of youth unemployment.

However, Sahlen maintained that the statistics were accurate.

“It seems odd that Sweden should have more full-time students looking for part-time work than other countries do, given that they all measure unemployment in the same way,” she said.